Parliament

Gordon Campbell | Parliament TV | Parliament Today | Video | Questions Of the Day | Search

 

Mates’ rates for Aussie insurers will cost Kiwis

Hon Maryan Street
Minister for ACC


2 July 2008 Media Statement

Mates’ rates for Aussie insurers will cost Kiwis

Australian insurance company investors are being advised they would reap large profits if the ACC scheme was privatised, but it would come at significant cost to New Zealanders, says ACC Minister Maryan Street.

“The confidential Merrill Lynch briefing to Australian investors, made public today, says National has given insurers a strong message it would privatise the $10.3 billion public asset if ever elected - although the party consistently refuses to provide any policy details to the New Zealand public.

“The briefing says privatisation of ACC could be a “very positive development” for Australian insurers which should be able to “capture” what will become the New Zealand injury insurance market.

“Putting the world-respected ACC scheme up for sale will rob all New Zealanders of the security they have enjoyed in the event of accidents, wherever and however they occur, for several decades,” Maryan Street said.

“Once National has traded away the protection the current state monopoly offers, accident compensation will become a lottery.

“For a start, levies will skyrocket. The Merrill Lynch briefing notes that Australians pay significantly more for injury protection per person than New Zealanders and that they get less cover for the price.

This mirrors independent research by PriceWaterhouseCoopers released earlier this year which showed the same companies Merrill Lynch expects to take over the New Zealand market, charge Australian employers 250 per cent more in levies as a proportion of wages, Maryan Street said.

“That report found ACC employer contributions were 0.78 per cent of wages, compared to an Australian average of two per cent. It found ACC motor vehicle levies were also significantly lower.

“Perhaps most worryingly, the report found that without ACC - and under a scenario similar to that in Canada, the US and Australia – roughly 70 per cent of current ACC clients would only receive benefits through social security and the public health system, a significant erosion of the support they now get.

“Under that scenario, individuals would be forced to take out private insurance in the event they fall off a ladder or injure themselves in a rugby game - and be left without accident compensation if they don’t,” Maryan Street said.

“They may have to pay to battle for their rights in court as do injured people in a number of other countries, including Australia – and if they do win the evidence is that insurers will pay less compensation and invest less in rehabilitation.

“The National Party sold off the railways and we have had to buy it back. Selling off ACC is so much more serious, because it’s playing with people’s health and wellbeing – and that of their families. New Zealanders make 5000 ACC claims a day. Are we really prepared to put that in the hands of Australian companies whose only driver is profit?

“What makes this a particuarly ugly underarm bowl by National leader John Key is that his Merrill Lynch mates and the Australian insurance companies know about his plans and the New Zealand public doesn’t,” said Maryan Street.”

--

Other findings in the PriceWaterhouseCoopers report.

• “The ACC under its current government monopoly structure performs as well or better than most other structures” worldwide, is often considered to be “best practice” and provides broader coverage than any other scheme in the world.

• The best mechanism for delivering the employers and motor vehicle accounts in New Zealand is the current government monopoly.

• ACC clients return to work faster than their Australian counterparts and ACC has lower claim management and administration rates.

• In the US, UK and several Australian states the use of lump sum payments, instead of the weekly compensation paid by ACC, generally disadvantages clients . Lump sum payments are typically used by private insurers and often fail to cover the needs of people with long-term or serious injuries in particular.

• Research shows private insurers are often less concerned about the vocational rehabilitation of injured clients – and that a significant group of people can miss out on injury cover altogether under privatised schemes.

© Scoop Media

 
 
 
 
 
Parliament Headlines | Politics Headlines | Regional Headlines

Back Again: Government Approves TPP11 Mandate

The Government has approved a negotiating mandate for Trans-Pacific Partnership 11 (TPP11), which will ensure New Zealand businesses remain competitive in overseas markets.

Trade Minister Todd McClay says New Zealand will be pushing for the minimal number of changes possible to the original TPP agreement, something that the remaining TPP11 countries have agreed on. More>>

ALSO:

.

 
 

Gordon Campbell: On Why Labour Isn’t Responsible For Barnaby Joyce

As a desperate Turnbull government tries to treat the Barnaby Joyce affair as a Pauline Hanson fever dream – blame it on the foreigners! We’re the victims of the dastardly New Zealand Labour Party! – our own government has chosen to further that narrative, and make itself an accomplice. More>>

ALSO:

Rail: Greens Back Tauranga – Hamilton – Auckland Service

The Green Party today announced that it will trial a passenger rail service between Auckland, Hamilton and Tauranga starting in 2019, when it is in government. More>>

ALSO:

Housing: Voluntary Rental Warrant Of Fitness For Wellington

Wellington City Council is partnering with the University of Otago, Wellington, to launch a voluntary Rental Warrant of Fitness for minimum housing standards in Wellington, Mayor Justin Lester has announced. More>>

ALSO:

Treaty: Agreement In Principle Signed With Moriori

“The Crown acknowledges Moriori was left virtually landless from 1870, hindering its cultural, social and economic development. The Crown also acknowledges its contribution to the myths that the people of Moriori were racially inferior and became extinct." More>>

ALSO:

Susan Devoy: Call For Inquiry Into State Abuse Reaches UN

Race Relations Commissioner Dame Susan Devoy is in Geneva and has asked a United Nations committee to urge the New Zealand government to initiate an inquiry into the physical and sexual abuse of children and disabled people held in state institutions. More>>

ALSO:

(Not National): Cross-Party Agreement On Pike River Re-Entry

The commitment was signed this afternoon by the leaders of Labour, United Future, The Maori Party, and the Green Party and, together with the earlier commitment by New Zealand First, means that there is now a Parliamentary majority behind the families’ fight for truth and justice. More>>

ALSO:

Earlier:

 
 
 
 
 
 

LATEST HEADLINES

  • PARLIAMENT
  • POLITICS
  • REGIONAL
 
 

Featured InfoPages

Opening the Election
 
 
 
  • PublicAddress
  • Pundit
  • Kiwiblog